DRIP Exchange
The reason for this exchange is to provide a way to invest in a company that requires ownership of at least a single share of stock (and doesn't charge fees for investing)
The fact that the stock must be registered in your name (not in the name of a brokerage firm) makes it difficult for people to become enrolled.
While there is a way to get enrolled in some companies without owning even a single share, that way is offered by transfer agents for some companies–and there is a fee charged each time you invest. Every company with a DRIP is available to shareholders (one share registered in your name qualifies you for this purpose).
Some of these companies are also available through the transfer agent. The companies that are also available through the transfer agent charge fees for every investment through the plan.
If the transfer agent charges fees, you will be charged a fee regardless of how you entered the plan.
Many of the finest U.S companies have plans where your investments will not involve fees. If you wish to invest in any of the companies available on the DRIP Exchange, be sure to confirm that there is no fee by clicking on the company name.
The DRIP Exchange includes companies that require a single share (and are not available through a transfer agent). the DRIP Exchange also includes companies that are available through the transfer agent.
Below are the procedures we follow to accomplish the goal:
How it works:
When a DRIP Club Member wants to list a company on the Exchange:
- A member will send us an email to say that he/she has a share (or shares) of a company to list.
- In response, we ask the member to share his/her personal information along with a copy of a statement from the company transfer agent showing at least the number of shares that was specified as available to be listed. (We only list one share of the company–regardless of how many that are available.)
- After we are satisfied with the identity of the member and have seen evidence ownership, we respond by sending the member a transfer form from the appropriate transfer agent (depending on the company being listed) and request that the member take the form and a copy of his/her statement to a bank or other financial institution to confirm the owners identify and ownership in the company by stamping the form with a Medallion Stamp.
- After the transfer form is stamped, the member is asked to send it to us and we will list the company on the Exchange Page.
- Regardless of the number of shares the member would like to list, we will list only 1 share on the Exchange Page (because entry into a DRP account generally requires that the investor own at least one share registered in his/her name).
- When another DRIP club members wishes to open an account in that company, we will contact the share owner to establish the acceptable price for the share, which will be no more than 25% more than the current price (which allows for price advances during the transfer interval). [We consider the potential for any loss based on the cost of the single share to be insignificant when compared with the opportunity to make future investments to buy multiple shares without paying fees.]
When a member wants to open an account in a company that is available to be acquired:
- A member will send an email or snail mail to indicate that he/she would like to open an account in a specific company that is listed on the Exchange page.
- First, we will confirm that the company is still available and listed on the page.
- Then we will respond to ask the member’s personal information including, the company to be acquired and the member’s Name, Address, Phone Number, DOB, and SS#.
- When we have the personal information (which we consider as proof of the acquirer’s interest to open the account), we contact the owner of the company to establish the cost to be charged to the acquirer of the share.
- Having proof of the share’s ownership (in a form of a medallion-stamped transfer form) as well as proof of the willingness of the acquirer to acquire the share, we will add the acquiring member’s registration information to the transfer form provided by the seller and send it to the transfer agent for the company.